Thursday, 8 December 2011

Unaffordable affordable housing: A messed up world

Madness - the £189k unaffordable affordable house

It was a lively meeting of Northumberland County Council today. The highlight was the slightly surreal moment of the Tories proposing a motion urging ring fencing second home council tax money for affordible homes and the Lib Dems, Independent and Labour groups uniting to oppose it! The Lib Dems and Independents opposed it because it would have inadvertanly reduced the amount the council spends on affordible homes, Labour because they vote against anything the "party of Thatcher" put forward even if it makes sense.

But it did lead to a debate about affordable homes. The Tory group, which is incidentally made up of a large number of very wealthy landowners, think we just need to raise the amount we spend on buying sites, presumably off very wealthy landowners. Labour have no solutions. Cllr Andrew Tebbutt for the Lib Dems pointed out that there are more than a 1,000 affordable homes with planning permission that are not being built and we have land banks across the county we could give to proactive developers. I was really pleased to hear from Cllr Tom Brechany that the counties "lend a hand" scheme, where we guarantee mortgages to new home buyers who can't get a mortgage, had given its first mortgage.

In my own little way, I contributed to the debate because in my home town of Prudhoe we have an example of everything is wrong with affordable housing. In the town we have only three sites where significant amounts of new housing can be built without encroaching on greenbelt land. There was only one in "public" hands where there is the most chance of a development. That is at the former Prudhoe Hospital site. Back in the distant past of the Blair government in 2004, deputy prime minister John Prescott said that he would be making all NHS sites be turned into social housing sites for key workers (I'm not dreaming this, see the article on the BBC website here - it names Prudhoe). Great news, as Prudhoe urgently needs more social housing with a massive waiting list for affordable homes.

Of course it was total rubbish. NHS estates sold the site to the highest bidder, as it needed money for the new hospital building (of course that's not true, they had full funding for it). They sold it to Gentoo homes, a profit making division of the Gentoo group which has its origins in Sunderland's council housing stock. They put in an application with 40% affordable homes, the minimum allowed in Tynedales plan for new homes. I wasn't as happy as when Mr Prescott pushed the 100% idea. But at least a developer with a strong commitment to social housing was developing the site and we would get 40% of the homes for the people who need them.

But of course Gentoo don't give a monkeys about people in Prudhoes needs, they just want to make as much money as possible to ship back to Wearside. They slapped in a change to the affordable level to 22%, using a tool called the "economic viability test". Across the county, developers are now using this tool to make a methodology to push the idea that in the recession they can't build any homes unless we reduce the number of affordable homes. The councils planning department appears to not have any discretion and has to listen to these arguments. It drives a coach and horses through then planning system, which tries to ensure that homes are built which are needed rather than what makes developers the most money.

The homes in the "Humbles Wood" development have gone on sale, with house prices going up to £360,000. Within a week a majority of them have been snapped up, off plan, without a brick being laid. So much for there being no market or profit in this development! Scandalously all the affordable homes are not what I would call affordable. Firstly they are for sale not for rent. The disadvantaged people who need my help as a councillor are nowhere being in a position to buy. When you are a victim of domestic violence, for example, you and your children need a place of safety to rent. And as for them being affordable, these so called affordable homes are from £108,500 to a staggering £189,000. And then you only own 70% of the property! The median wage in this country is £25,000 (much lower in Prudhoe). To buy even the cheapest affordable home here you need to earn considerably more than that. You can buy houses in Prudhoe for a lot less and you get 100% of the house to yourself.

So a public body has ignored its responsibility to the people in the community it serves to give them affordable homes, a public housing association has manipulated the planning rules to reduce its obligations to the minimum and has then completely taken the Michael in terms of what it defines as affordable Until councils can crack down on this madness, I fear the idea of us getting homes for local people that they can afford is a pipe dream. I will be working hard to get Northumberland council to be a leading body trying to sort this out.

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About Me

I am a 37 year old Liberal Democrat campaigner and councillor. I was the Liberal Democrat Prospective Parliamentary Candidate for Blaydon Constituency and am the Town and County Councillor for Prudhoe West. Outside of politics I am a manager at a Citizens Advice Bureau and am a non-executive director on Northumberland Care Trust